Jim Turnour (Leichhardt, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. How do prospects for the Australian and other Asian economies compare with elsewhere in the world, and what does this say about the need for economic reform here at home?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Leichhardt for this very important question. It is the case that Australia did come through the global financial crisis in a very strong position. We did that for two reasons, one because of the timely and powerful stimulus that we put in place, which is supporting employment right across the country, particularly in places like Leichhardt where it is necessary and required as we speak. Not every section of the economy is growing at the same speed, and that is why we do need continuing economic reform. I think all Australians can be pretty proud of their efforts during this global financial crisis, and you can see this in the latest employment numbers—250,000 jobs have been created in this country since the crisis began. Contrast that with what is happening elsewhere in the developed world. Those opposite might want to ignore that, because the truth is that, had they been in charge last year and the year before, there would not have been 250,000 jobs created in this country. Unemployment would have been much higher, and of course small business closures would have been very, very significant. There are small businesses with their doors open as a result of stimulus, and there are breadwinners earning an income, in jobs, because of stimulus. That is very important, particularly in electorates like Leichhardt.

I have been asked about the international economy. Global growth is patchy—there is not just a two-speed economy in this country; there is a two-speed global recovery as well. Of course our region is growing stronger than the rest of the world. As we know, there are downside risks to that recovery particularly with what is going on in Europe. We can face that situation with confidence because of the underlying strengths in our economy. Our economy is recovering solidly, our unemployment rate is low, our financial system is stable, and of course our public finances are very strong—and that was demonstrated in our most recent budget. This is what the Governor of the Reserve Bank had to say only last week:

Australia’s budgetary position is very different from those in Europe and, for that matter, most countries. Public debt is low and budget deficits are under control and already scheduled to decline.

That is a very big tick for our fiscal policy. The minutes of the Reserve Bank from a day or two ago say:

… members noted that the medium term outlook remained positive … The prices of Australia’s main commodity exports were still elevated … the economy was continuing to expand.

But we know that, as we expand, we have to meet the challenge of economic reform. That is why in parts of the country, particularly parts like Leichhardt, businesses, families, are crying out for a cut in their corporate rate of tax. They need economic reform. Small business needs support. Employment in small business needs support. Of course, all of those great mining communities need the infrastructure investment. That is why economic reform is so important and that is why the attitude of those opposite is so grossly irresponsible.

If we are going to build on our strengths, keep up the momentum for reform, then what we need is a far-sighted reform program. This side of the House has one; that side of the House does not. They have this incredible view that miners are paying too much tax and that there should be a tax cut for miners and a tax increase for all the small businesses in Leichhardt. That is the approach of those opposite. All of those struggling small businesses around Australia that they pretend to stand up for potentially face a corporate tax increase with those opposite. Those opposite stand for higher taxation for the entire business community; we on this side of the House stand for tax reform and a fair go for Australian families.